Republicans See Leverage From Supreme Court for Obamacare Overhaul

GOP leaders are happy to help if SCOTUS strikes down health care exchanges, but it would come at a heavy price for the ACA.

Speaker of the House John Boehner (R-Ohip) attends a press conference following the weekly House Republican conference meeting at the U.S. Capitol February 25, 2015 in Washington, DC with Rep. John Kline (R-Minn.).
National Journal
Dylan Scott
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Dylan Scott
March 3, 2015, 3 p.m.

House Re­pub­lic­an lead­ers say they’re happy to help with a con­tin­gency plan if the Su­preme Court in­val­id­ates Obama­care’s tax cred­its in the 30-plus states that use the fed­er­al Health­Care.gov web­site.

But that help would come at a high price.

Should the Court rule against the Obama ad­min­is­tra­tion, the GOP lead­ers would seize the op­por­tun­ity to sig­ni­fic­antly re­shape the health care land­scape — while keep­ing some of the more pop­u­lar parts of the Af­ford­able Care Act.

A plan from three key Re­pub­lic­an com­mit­tee chair­men pro­poses giv­ing states the op­por­tun­ity to re­peal Obama­care’s in­di­vidu­al and em­ploy­er man­dates as well as its cov­er­age re­quire­ments. That alone would change the law’s mech­an­ics in fun­da­ment­al ways and rep­res­ent a huge polit­ic­al and policy vic­tory for the GOP. States, the ma­jor­ity of which are con­trolled by Re­pub­lic­ans, would be able to opt out of some of the law’s ma­jor and most-hated pro­vi­sions.

(RE­LATED: Will John Roberts or An­thony Kennedy Save Obama­care?)

The Su­preme Court will hear or­al ar­gu­ments in King v. Bur­well on Wed­nes­day. If the justices rule against the Obama ad­min­is­tra­tion and dis­al­low tax cred­its on Health­Care.gov later this year, as many as 8 mil­lion people are ex­pec­ted to lose their fin­an­cial aid un­der the law.

“If that hap­pens, then you’ll have some 4 [mil­lion], 5 mil­lion people who will find them­selves where they didn’t think they were go­ing to be. So we think it’s im­port­ant to have some pro­vi­sions in place,” House Edu­ca­tion and the Work­force Chair­man John Kline, R-Minn., told Na­tion­al Journ­al.

“In the lar­ger sense, I think the pro­pos­als that we’re look­ing at would in­deed be much bet­ter for health care, be­cause ob­vi­ously we don’t like the Af­ford­able Care Act,” Kline ad­ded. “Those things “¦ are ways to look to lower costs, so we think that King v. Bur­well may be what al­lows us to make them.”

Kline, Ways and Means Chair­man Paul Ry­an, R-Wis., and En­ergy and Com­merce Chair­man Fred Up­ton, R-Mich., in­tro­duced the pro­pos­al Monday in a Wall Street Journ­al op-ed.

Aside from point­ing a policy path for­ward, the Re­pub­lic­an pro­pos­als serve an­oth­er role: sig­nal­ing to the Su­preme Court that con­gres­sion­al Re­pub­lic­ans would be ready to act if the Court ruled to nix the tax cred­its on Health­Care.gov, which could oth­er­wise send the in­sur­ance mar­kets in the states that use the fed­er­al web­site in­to chaos.

Their plan would keep some fea­tures of Obama­care in place. It would cre­ate a tax cred­it to help people buy in­sur­ance, in­ten­ded to re­store fin­an­cial aid to the mil­lions of people who would lose it if the Court ruled against the Obama ad­min­is­tra­tion, al­though the spe­cif­ics would dif­fer from the ACA’s cur­rent tax sub­sidy. The GOP plan would keep the law’s ban on life­time be­ne­fits and al­low chil­dren to stay on their par­ents’ in­sur­ance un­til age 26. It would also provide some pro­tec­tions for people with preex­ist­ing con­di­tions and al­low small busi­nesses to pool to­geth­er to pur­chase in­sur­ance.

(RE­LATED: 5 Things to Watch in SCOTUS’ Obama­care Ar­gu­ments)

And by giv­ing states a choice, some states — namely, the dozen-plus that have cre­ated their own ex­changes and wouldn’t be dir­ectly af­fected by a Court rul­ing strik­ing down the Obama­care sub­sidies — could con­tin­ue im­ple­ment­ing the law whole­sale.

Some of the policies that Re­pub­lic­ans would al­low to stand are ones that they have sup­por­ted since be­fore Obama­care, Kline said.

“That pro­pos­al, for ex­ample, the age-26 [pro­vi­sion], was in the al­tern­at­ive we pro­posed be­fore the ACA passed,” he said. He also lis­ted al­low­ing people to buy in­sur­ance across state lines and the small-busi­ness pools as policies in their King con­tin­gency plan that the GOP had pro­posed be­fore. “Those were all pieces that we had pro­posed be­fore this was jammed through in 2009.”

There is the catch, though, that these pro­pos­als aren’t yet co­di­fied in le­gis­lat­ive lan­guage, where the all-im­port­ant minu­tia will be fleshed out. House Re­pub­lic­ans plan to form­al­ize their pro­pos­al in le­gis­la­tion be­fore the Court makes its rul­ing, ex­pec­ted this sum­mer, an aide said.

“If you take these ideas from Re­pub­lic­an lead­ers at face value, it’s ap­par­ent that at least at the level of broad prin­ciples, the cent­ral aims of Obama­care have be­come hard to op­pose,” said Larry Levitt, vice pres­id­ent of the Kais­er Fam­ily Found­a­tion. “These pro­pos­als could, of course, look very dif­fer­ent once the de­tails are fleshed out. And, they sig­nal much less reg­u­la­tion of the in­sur­ance in­dustry than un­der the Af­ford­able Care Act.”

Sens. Lamar Al­ex­an­der, R-Tenn., Or­rin Hatch, R-Utah, and John Bar­rasso, R-Wyo., wrote an op-ed in The Wash­ing­ton Post on Monday, an­noun­cing that they too would put for­ward a post-King plan. Hatch, Up­ton, and Sen. Richard Burr, R-N.C., re­leased an­oth­er health care pro­pos­al earli­er this month, al­though it is a full re­peal-and-re­place plan not as dir­ectly tied to the King case.

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